New York Securities Fraud Lawyers Blog
As the summer winds down and employees begin contemplating transitions to a new employer, financial professionals must be aware of the rules, procedures, and contracts impacting a potential transition to a new firm. To help keep financial professionals apprised of important considerations when changing employers, Malecki Law, one of New York’s experienced financial services employment law firms, created the Post Summer Transitions blog series. This blog will focus on one of the most important considerations impacting most transitioning employees regardless of the industry: non-competition agreements.
On August 20, 2024, Judge Ada Brown, sitting in the United States District Court for the Northern District of Texas, Dallas Division, issued an opinion and order setting aside the Federal Trade Commission’s (the FTC) recently implemented Non-Compete Rule, which was set to effectively outlaw non-competition agreements across the country in early September 2024. Judge Brown’s ruling is sure to impact employees working in nearly every industry and cause the FTC to rethink its approach to curbing unfair methods of competition in the context of employment relationships.
On April 23, 2024, the FTC announced a new, final rule banning most non-competition agreements nationwide. In announcing the new rule, FTC Chair Lina M. Khan explained that “noncompete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism.” Further, the FTC expected the new rule to generate tens of thousands of new patents and thousands of new businesses each year, as well as allow the average employee to earn additional compensation amounting to more than $500 per year. The Non-Compete Rule was slated to take effect on September 4, 2024. If you are a financial professional who is experiencing non-competition issues with a previous employer, you should consult a seasoned Securities Employment lawyer, like the ones at NYC’s Malecki Law.